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The award of The Permanent Court of Arbitration Tribunal in South China Sea, What next?

Chinese coast guard ship in South China Sea ( Image credits- VOA)
At last the long awaited ruling has come in the South China Sea dispute between China and the Philippines. The Permanent Court of Arbitration Tribunal has ruled over overwhelmingly in favour of the Philippines. The ruling has set at rest the long held Chinese argument of claim over the whole of South China Sea on the ground of historical precedent. It laid down the broader law by which China's claim to the islands in South China Sea and it's encompassing Exclusive Economic Zone has been rejected. China is put to great embarrassment as China is a signatory to The United Nations Convention on Laws of the Sea (UNCLOS) and is bound by the terms and laws laid down in the said convention. China outright rejected the ruling saying that the same is unilateral in nature and the Court does not have the right to adjudicate in sovereign disputes. 

What is the South China Sea Dispute:

The South China Sea disputes involve both island and maritime claims among several sovereign states within the region, namely the Nation of Brunei, the People's Republic of China, the Republic of China (Taiwan), Malaysia, the Republic of the Philippines, and the Socialist Republic of Vietnam. Non-claimants want the South China Sea to remain as international waters, with the United States of America conducting "freedom of navigation" operations.

There are disputes concerning both the Spratly and the Paracel islands, as well as maritime, areas near to sea, boundaries in the Gulf of Tonkin and elsewhere. There is a further dispute in the waters near the Indonesian Natuna Islands.The interests of different nations include acquiring fishing areas around the two archipelagos; the potential exploitation of crude oil and natural gas under the waters of various parts of the South China Sea, and the strategic control of important shipping lanes.

The Shangri-La Dialogue serves as the "Track One" exchange forum on security issues surrounding the Asia-Pacific region, including territorial disputes in the South China Sea. The Council for Security Cooperation in the Asia Pacific is the "Track Two" forum for dialogue on security issues.

The area may be rich in oil and natural gas deposits; however, the estimates are highly varied. The Ministry of Geological Resources and Mining of the People's Republic of China estimate that the South China Sea may contain 17.7 billion tons of crude oil (compared to Kuwait with 13 billion tons). In the years following the announcement by the ministry, the claims regarding the South China Sea islands intensified. However, other sources claim that the proven reserve of oil in the South China Sea may only be 7.5 billion barrels, or about 1.1 billion tons. According to the US Energy Information Administration (EIA)'s profile of the South China Sea region, a US Geological Survey estimate puts the region's discovered and undiscovered oil reserves at 11 billion barrels, as opposed to a Chinese figure of 125 billion barrels. The same EIA report also points to the wide variety of natural gas resource estimations, ranging from 190 trillion cubic feet to 500 trillion cubic feet, likely located in the contested Reed Bank".

The South China Sea is dubbed by China as the "second Persian Sea." The state-owned China Offshore Exploration Corp. planned to spend 200 billion RMB (US$30 billion) in the next 20 years to exploit oil in the region, with the estimated production of 25 million metric tons of crude oil and natural gas per annum, at a depth of 2000 meters within the next five years.

The Philippines began exploring the areas west of Palawan for oil in 1970. Exploration in the area began in Reed Bank/Tablemount. in 1976, gas was discovered following the drilling of a well. However, China's complaints halted the exploration.

On 27 March 1984, the first Philippine oil company discovered an oil field off Palawan, which is an island province bordering the South China Sea and the Sulu Sea. These oil fields supply 15% of annual oil consumption in the Philippines.

The nine-dotted line was originally an "eleven-dotted-line," first indicated by the then Kuomintang government of the Republic of China in 1947, for its claims to the South China Sea. After, the Communist Party of China took over mainland China and formed the People's Republic of China in 1949. The line was adopted and revised to nine as endorsed by Zhou Enlai.

The legacy of the nine-dotted line is viewed by some Chinese government officials, and by the Chinese military, as providing historical support for their claims to the South China Sea.

In the 1970s, however, the Philippines, Malaysia and other countries began referring to the Spratly Islands as included in their own territory. On 11 June 1978, President Ferdinand Marcos of the Philippines issued Presidential decree No. 1596, declaring the Spratly Islands (referred to therein as the Kalayaan Island Group) as Philippine territory.

The abundant fishing opportunities within the region are another motivation for the claim. In 1988, the South China Sea is believed to have accounted for 8% of world fishing catches, a figure that has grown since then. There have been many clashes in the Philippines with foreign fishing vessels (including China) in disputed areas. China believes that the value in fishing and oil from the sea has risen to a trillion dollars.

The area is also one of the busiest shipping routes in the world. In the 1980s, at least 270 merchant ships used the route each day. Currently, more than half the tonnage of oil transported by sea passes through it, a figure rising steadily with the growth of Chinese consumption of oil. This traffic is three times greater than that passing through the Suez Canal and five times more than the Panama Canal.

As of 1996, Vietnam, the Philippines, Brunei, Malaysia and other countries asserted claims within the Chinese nine-dotted line. The United Nations Convention on the Law of the Sea, which came into effect on 16 November 1994, resulted in more intense territorial disputes between the parties.

As of 2012, all of the Paracel Islands are under Chinese control.

Eight of the Spratly Islands are under Chinese control; Vietnamese troops control the greatest number of Spratly islands, Eight islands are controlled by the Philippines, five by Malaysia, two by Brunei and one by Taiwan. In 2012 the Indian Ambassador to Vietnam, while expressing concern over rising tension in the area, said that 50 per cent of its trade passes through the area and called for peaceful resolution of the disputes in accordance with international law.

On March 17, 2016, in accordance with Memorandum Circular No. 94 s. 2016, President Aquino created the National Task Force for the West Philippine Sea, to secure the State's sovereignty and national territory and preserve marine wealth in its waters and exclusive economic zone, reserving use and enjoyment of the West Philippine Sea exclusively for Filipino citizens.

In July 2016, an arbitral tribunal consitituted under Annex VII of the United Nations Convention on the Law of the Sea ruled against China's territorial claims in Philippines v. China. Although it is not enforceable China does not acknowledge the tribunal nor abide by its ruling, insisting that any resolution should be through bilateral negotiations with other claimants.

What is UNCLOS?

The United Nations Convention on the Law of the Sea (UNCLOS), also called the Law of the Sea Convention or the Law of the Sea treaty, is the international agreement that resulted from the third United Nations Conference on the Law of the Sea (UNCLOS III), which took place between 1973 and 1982. The Law of the Sea Convention defines the rights and responsibilities of nations with respect to their use of the world's oceans, establishing guidelines for businesses, the environment, and the management of marine natural resources. The Convention, concluded in 1982, replaced four 1958 treaties. UNCLOS came into force in 1994, a year after Guyana became the 60th nation to sign the treaty.As of June 2016, 167 countries and the European Union have joined in the Convention. It is uncertain as to what extent the Convention codifies customary international law.

While the Secretary General of the United Nations receives instruments of ratification and accession and the UN provides support for meetings of states party to the Convention, the UN has no direct operational role in the implementation of the Convention. There is, however, a role played by organizations such as the International Maritime Organization, the International Whaling Commission, and the International Seabed Authority (ISA). (The ISA was established by the UN Convention.)


UNCLOS replaces the older 'freedom of the seas' concept, dating from the 17th century: national rights were limited to a specified belt of water extending from a nation's coastlines, usually 3 miles (Three-mile limit), according to the 'cannon shot' rule developed by the Dutch jurist Cornelius van Bynkershoek.All waters beyond national boundaries were considered international waters: free to all nations, but belonging to none of them (the mare liberum principle promulgated by Hugo Grotius).


In the early 20th century, some nations expressed their desire to extend national claims: to include mineral resources, to protect fish stocks, and to provide the means to enforce pollution controls. (The League of Nations called a 1930 conference at The Hague, but no agreements resulted.) Using the customary international law principle of a nation's right to protect its natural resources, President Harry S. Truman in 1945 extended United States control to all the natural resources of its continental shelf. Other nations were quick to follow suit. Between 1946 and 1950, Chile, Peru, and Ecuador extended their rights to a distance of 200 nautical miles (370 km) to cover their Humboldt Current fishing grounds. Other nations extended their territorial seas to 12 nautical miles (22 km).

By 1967, only 25 nations still used the old 3-mile (4.8 km) limit,] while 66 nations had set a 12-nautical-mile (22 km) territorial limit and eight had set a 200-nautical-mile (370 km) limit. As of 28 May 2008, only two countries still use the 3-mile (4.8 km) limit: Jordan and Palau. That limit is also used in certain Australian islands, an area of Belize, some Japanese straits, certain areas of Papua New Guinea, and a few British Overseas Territories, such as Anguilla.

The issue of varying claims of territorial waters was raised in the UN in 1967 by Arvid Pardo of Malta, and in 1973 the Third United Nations Conference on the Law of the Sea was convened in New York. In an attempt to reduce the possibility of groups of nation-states dominating the negotiations, the conference used a consensus process rather than majority vote. With more than 160 nations participating, the conference lasted until 1982. The resulting convention came into force on 16 November 1994, one year after the 60th state, Guyana, ratified the treaty.

The convention introduced a number of provisions. The most significant issues covered were setting limits, navigation, archipelagic status and transit regimes, exclusive economic zones (EEZs), continental shelf jurisdiction, deep seabed mining, the exploitation regime, protection of the marine environment, scientific research, and settlement of disputes.

The convention set the limit of various areas, measured from a carefully defined baseline. (Normally, a sea baseline follows the low-water line, but when the coastline is deeply indented, has fringing islands or is highly unstable, straight baselines may be used.) The areas are as follows:

Internal waters

Covers all water and waterways on the landward side of the baseline. The coastal state is free to set laws, regulate use, and use any resource. Foreign vessels have no right of passage within internal waters.
Territorial waters

Out to 12 nautical miles (22 kilometres; 14 miles) from the baseline, the coastal state is free to set laws, regulate use, and use any resource. Vessels were given the right of innocent passage through any territorial waters, with strategic straits allowing the passage of military craft as transit passage, in that naval vessels are allowed to maintain postures that would be illegal in territorial waters. "Innocent passage" is defined by the convention as passing through waters in an expeditious and continuous manner, which is not "prejudicial to the peace, good order or the security" of the coastal state. Fishing, polluting, weapons practice, and spying are not "innocent", and submarines and other underwater vehicles are required to navigate on the surface and to show their flag. Nations can also temporarily suspend innocent passage in specific areas of their territorial seas, if doing so is essential for the protection of its security.
Archipelagic waters

The convention set the definition of Archipelagic States in Part IV, which also defines how the state can draw its territorial borders. A baseline is drawn between the outermost points of the outermost islands, subject to these points being sufficiently close to one another. All waters inside this baseline are designated Archipelagic Waters. The state has sovereignty over these waters (like internal waters), but subject to existing rights including traditional fishing rights of immediately adjacent states.[8] Foreign vessels have right of innocent passage through archipelagic waters (like territorial waters).

Contiguous zone

Beyond the 12-nautical-mile (22 km) limit, there is a further 12 nautical miles (22 km) from the territorial sea baseline limit, the contiguous zone, in which a state can continue to enforce laws in four specific areas: customs, taxation, immigration and pollution, if the infringement started within the state's territory or territorial waters, or if this infringement is about to occur within the state's territory or territorial waters.[9] This makes the contiguous zone a hot pursuit area.

Exclusive economic zones (EEZs)

These extend from the edge of the territorial sea out to 200 nautical miles (370 kilometres; 230 miles) from the baseline. Within this area, the coastal nation has sole exploitation rights over all natural resources. In casual use, the term may include the territorial sea and even the continental shelf. The EEZs were introduced to halt the increasingly heated clashes over fishing rights, although oil was also becoming important. The success of an offshore oil platform in the Gulf of Mexico in 1947 was soon repeated elsewhere in the world, and by 1970 it was technically feasible to operate in waters 4,000 metres deep. Foreign nations have the freedom of navigation and overflight, subject to the regulation of the coastal states. Foreign states may also lay submarine pipes and cables.
Continental shelf

The continental shelf is defined as the natural prolongation of the land territory to the continental margin's outer edge, or 200 nautical miles (370 km) from the coastal state's baseline, whichever is greater. A state's continental shelf may exceed 200 nautical miles (370 km) until the natural prolongation ends. However, it may never exceed 350 nautical miles (650 kilometres; 400 miles) from the baseline; or it may never exceed 100 nautical miles (190 kilometres; 120 miles) beyond the 2,500-meter isobath (the line connecting the depth of 2,500 meters). Coastal states have the right to harvest mineral and non-living material in the subsoil of its continental shelf, to the exclusion of others. Coastal states also have exclusive control over living resources "attached" to the continental shelf, but not to creatures living in the water column beyond the exclusive economic zone.

Aside from its provisions defining ocean boundaries, the convention establishes general obligations for safeguarding the marine environment and protecting freedom of scientific research on the high seas, and also creates an innovative legal regime for controlling mineral resource exploitation in deep seabed areas beyond national jurisdiction, through an International Seabed Authority and the Common heritage of mankind principle.

Landlocked states are given a right of access to and from the sea, without taxation of traffic through transit states.

Part XI of the Convention provides for a regime relating to minerals on the seabed outside any state's territorial waters or EEZ (Exclusive Economic Zones). It establishes an International Seabed Authority (ISA) to authorize seabed exploration and mining and collect and distribute the seabed mining royalty.

The United States objected to the provisions of Part XI of the Convention on several grounds, arguing that the treaty was unfavorable to American economic and security interests. Due to Part XI, the United States refused to ratify the UNCLOS, although it expressed agreement with the remaining provisions of the Convention.

From 1982 to 1990, the United States accepted all but Part XI as customary international law, while attempting to establish an alternative regime for exploitation of the minerals of the deep seabed. An agreement was made with other seabed mining nations and licenses were granted to four international consortia. Concurrently, the Preparatory Commission was established to prepare for the eventual coming into force of the Convention-recognized claims by applicants, sponsored by signatories of the Convention. Overlaps between the two groups were resolved, but a decline in the demand for minerals from the seabed made the seabed regime significantly less relevant. In addition, the decline of Socialism and the fall of Communism in the late 1980s had removed much of the support for some of the more contentious Part XI provisions.

In 1990, consultations were begun between signatories and non-signatories (including the United States) over the possibility of modifying the Convention to allow the industrialized countries to join the Convention. The resulting 1994 Agreement on Implementation was adopted as a binding international Convention. It mandated that key articles, including those on limitation of seabed production and mandatory technology transfer, would not be applied, that the United States, if it became a member, would be guaranteed a seat on the Council of the International Seabed Authority, and finally, that voting would be done in groups, with each group able to block decisions on substantive matters. The 1994 Agreement also established a Finance Committee that would originate the financial decisions of the Authority, to which the largest donors would automatically be members and in which decisions would be made by consensus.

On 1 February 2011, the Seabed Disputes Chamber of the International Tribunal for the Law of the Sea (ITLOS) issued an advisory opinion concerning the legal responsibilities and obligations of States Parties to the Convention with respect to the sponsorship of activities in the Area in accordance with Part XI of the Convention and the 1994 Agreement. The advisory opinion was issued in response to a formal request made by the International Seabed Authority following two prior applications the Authority's Legal and Technical Commission had received from the Republics of Nauru and Tonga regarding proposed activities (a plan of work to explore for polymetallic nodules) to be undertaken in the Area by two State-sponsored contractors – Nauru Ocean Resources Inc. (sponsored by the Republic of Nauru) and Tonga Offshore Mining Ltd. (sponsored by the Kingdom of Tonga). The advisory opinion set forth the international legal responsibilities and obligations of Sponsoring States AND the Authority to ensure that sponsored activities do not harm the marine environment, consistent with the applicable provisions of UNCLOS Part XI, Authority regulations, ITLOS case law, other international environmental treaties, and Principle 15 of the UN Rio Declaration.

China's unsustainable claim:

The greatest weakness for China's claim in South China Sea is on historic precedent. But such claim is unsustainable under the UNCLOS. China has started massive reclamation of  uninhabited  and uninhabitable islands in South China Sea into bases with the intent to lay a claim under the provisions of UNCLOS with the intent to claim EEZ around these islands. But in most of the Islands, China has not had direct control for the last centuries. Hence witho continues control, China cannot claim the ownership over these islands under UNCLOS.

What Next:

The award will have a far reaching implication in years to come. Even though China has rejected the arbitration proceedings, yet being a signatory to the UNCLOS China is not entitled to the luxury of doing what they please. Countries in the littoral of South China Sea and other powers like USA, Japan, India and Australia will have the option to take direct military action should China obstruct the free enjoyment and movement through South China Sea. They will site the ruling of the tribunal as the precedent to take action as they are so empowered by the international laws.  China will not be able to reject the arbitration award either as they had chosen to remain exparte even though they were given ample time to appear and plead their case. 

China will also have to face several rounds of litigation as other claimants will opt to file a complaint before the international tribunal. It is time China understood that unilateral actions cannot be taken. The world has changed. Now the old world doctrine of power play will not be allowed. China will need to face the international consequences if they continue to reject the international award, something which a country that sees itself as a responsible emerging world power may not want. Only time will tell how the entire game in South China Sea will be played out. We can only wait and watch and hope for the best.


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